Greece should not accept any further austerity – full stop!

In the lead up to last weekend’s Greek referendum there was an extraordinary flurry of opinion pieces in newspapers around the World which sought to blame Greece for its own situation. Among the most ridiculous of these articles was the one which appeared in the British Independent (July 1, 2015) – Get off your high horses, lefties – Big Government, not ‘austerity’, has brought Greece to its knees . Apparently, left-wing views dominate the shelves of any mainstream bookstore in the UK and represent the mainstream economic opinion. It raises the question of which planet the writer is on! The writer also claimed that Syriza is just another leftie political party in Greece, in a long tradition of such parties, committed to “economic statism and hyperinterventionism”. And the current crisis is actually the result of decisions taken in the 1980s to build “up a huge client state” rather than surrendering the currency sovereignty in 2001. This blog explains that the Greek problem is one of insufficient spending. The fiscal deficit has to rise to stimulate growth. This problem emerged in 2008-09 and is largely due to the fiscal austerity that was imposed on the nation by the Troika. It might have crony-deals and all the rest of it, but that is not what brought the economy to its depressed state. That state is all down to human intervention from outside of Greece in the form of austerity. Greece should not accept any further austerity – full stop!
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    Posted in Economics, Eurozone | 4 Comments

    The ECB has to maintain ELA to Greek banks

    Despite the shamelessly dishonest press barrage from the conservative owners of the highly concentrated Greek media (the ‘oligarchs’) to vote YES; despite many articles popping up in world newspapers about how the Greeks are to blame for their own problems because they overspend and undertaxed; despite the lies coming from other European leaders about what the vote was about (it was not about leaving the Euro but rather about whether the Greek people wanted further failed austerity); despite the ridiculous claims of the German SDP about “bridges being burned” (that party should change its name because it is a disgrace to the social democratic tradition) – despite all of that and heaps more, the Greek people voted overwhelmingly NO to reject austerity as a viable policy model for their country. This is a case of democracy coming head to head with the dominant political-economic ideology within which the Greek nation is situated – the Eurozone. It also demonstrates the flaws of the democratic process – the people have voted for an end to austerity but also consistently tell opinion polls they want to remain in the Eurozone, a monetary system that is built on austerity. They voted yesterday to reject the very basis of the monetary system they want to stay in – which tells us they don’t really understand the nature of the system and therefore how informed is the NO vote.
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      Posted in Eurozone | 28 Comments

      Saturday Quiz – July 4, 2015 – answers and discussion

      Here are the answers with discussion for yesterday’s quiz. The information provided should help you work out why you missed a question or three! If you haven’t already done the Quiz from yesterday then have a go at it before you read the answers. I hope this helps you develop an understanding of Modern Monetary Theory (MMT) and its application to macroeconomic thinking. Comments as usual welcome, especially if I have made an error.
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        Saturday Quiz – July 4, 2015

        Welcome to the Billy Blog Saturday Quiz. The quiz tests whether you have been paying attention over the last seven days. See how you go with the following questions. Your results are only known to you and no records are retained.
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          Posted in Saturday quiz | 2 Comments

          Friday lay day – The five presidents of the Eurozone remain firmly in denial

          Its the Friday lay day blog again and I am in a rush. Under the smokescreen of all the Greek drama that has played out on the World stage over the last week the bosses of the Eurozone released their – Completing Europe’s Economic and Monetary Union – (June 22, 2015), aka the Five Presidents’ report. I read it this morning. And I am glad its Friday and I can keep to my promise of not writing much here and more elsewhere (book projects). Otherwise, the blog might have ended up full of the so-called expletives given the way these Euro Groupthink morons treat the citizens of Europe. Apparently, the euro is a big success! In the land of the fairies.
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            Europe’s US imported nightmare

            I note the US have been rather quietly urging the EU to resolve the so-called ‘Greek crisis’, which I really think is a euro-crisis, even though its current epicentre is in Greece. What the Americans are doing beyond the purview of the public gaze is anyone’s guess but we can be sure it is interventionist, self-interested and probably not helpful to the well-being of ordinary Europeans including Greeks. The US influence over Europe has, in fact, culminated in the crisis, even if that realisation is not understood by many. I have just finished reading a book by the French journalist/publisher and politician – Jean-Jacques Servan-Schreiber – who died in 2006. The book – Le Défi Américain (The American Challenge) was very popular when it was published in 1967. It initially was a major hit in France and later was translated widely. It helped me understand how the US intellectual tradition has at critical times in Europe’s modern history been so definitive.
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              Posted in Economics, Eurozone, US economy | 16 Comments

              The concept of ‘one Europe’ under threat from austerity

              The EU Flash Barometer surveys provide information about public opinion in Europe. The latest Survey(No. 418) – Introduction of the euro in the Member States that have not yet adopted the common currency – shows how confused people are in Europe at present. It seems that only 41 per cent of people in nations that “have not yet adopted the common currency” believe it would have “positive consequences” while 53 per cent think it would have “negative consequences”. That sounds as though they think the euro is a bad system. Well not exactly. The confusion might lie in the fact that the cruel system of austerity that the political elites have inflicted on the European nations is eroding the system of social stability that was established after the devastation of World War II. This is certainly the view taken by the ILO in a recent book it released. The ILO believe that the operations of the common currency (the austerity etc) is undermining the European Social Model, which is a core principle of an integrated Europe. So by insisting on maintaining the flawed currency system, the political elites are endangering the very thing they claim to revere – political integration – the ‘one Europe’.

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                Posted in Britain, Eurozone, UK Economy | 18 Comments

                So-called ‘free trade’ agreements should be strongly opposed

                My header this week is in solidarity for the Greek people. I hope they vote no and then realise that leaving the dysfunctional Eurozone will promise them growth and a return to some prosperity. They can become the banner nation for other crippled Eurozone nations – a guiding light out of the madness that the neo-liberal elites have created. While Greece battens down against the most incredible attack on European democracy since who knows when – perhaps since the Anschluss that led finally to war breaking out a year later in Europe, one wonders how low the Brussels elite will go to preserve control of the agenda. They clearly lost control on Friday when the Greek leadership decided to go back to the people to determine whether they wanted more poverty-inducing austerity. In response, the Brussels gang along with their Washington mates at the IMF have come out with personal attacks, lies, threats and ridiculous dissembling. But that is what happens when bullies can’t bully. But while these events are rather extraordinary in historical terms, other insidious attacks on democratic rights and choice are on-going. One of the more startling attempts to undermine the capacity of elected states to deliver on their mandate to their electorates and hand over almost absolute power over the state to international corporations is the so-called Trans-Pacific Partnership (TPP).
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                  Posted in Economics | 24 Comments

                  European Court of Justice effectively rules that Eurozone is a shambles

                  On June 2015, the – Court of Justice of the European Union – issued a press release summarising their decision with respect to the ECB’s Outright Monetary Transactions (OMT) programme – Judgment of the Court of Justice in Case C-62/14 Gauweiler and Others. The decision (No.70/2015) is a devastating indictment of the Eurozone and the elites that designed it and maintain its capricious and destructive behaviours. The latest events in Greece highlight how neo-liberal Groupthink can extend into the realm of venal fantasy in defiance of reality. The European Court of Justice decision ruled that the ECB was not acting unlawfully in implementing its bond buying program, despite the German Constitutional Court ruling otherwise. The point of the ruling is that the Court has decided to take a convenient line because the economic policy making institutions in the Eurozone are so parlous that the role of the ECB can be blurred to mean anything. What a shambles.
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                    Posted in Eurozone | 14 Comments

                    Saturday Quiz – June 27, 2015 – answers and discussion

                    Here are the answers with discussion for yesterday’s quiz. The information provided should help you understand the reasoning behind the answers. If you haven’t already done the Quiz from yesterday then have a go at it before you read the answers. I hope this helps you develop an understanding of Modern Monetary Theory (MMT) and its application to macroeconomic thinking. Comments as usual welcome, especially if I have made an error.
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                      Posted in Saturday quiz | 3 Comments